The reform of vertical arrangements of tax administrative agencies in China

Ma Jun


The decentralized tax administration has been in place for over two decades in China since 1994. In March this year, National People’s Congress of China reviewed and approved the State Council Institutions Reform Plan and decided “we will reform the tax administrative system by merging the tax administrations on state and sub-national levels and assume it both tax and non-tax revenue administrative responsibility in the corresponding jurisdictions”. The article aims to explain to readers that China’s tax authorities have to a large extent absorbed common international practices and general experience. The history of the vertical arrangements of China’s tax administration is revisited through descriptive and comparative analysis. The reasons for the cancellation of the sub-national tax bureaus in China are analyzed followed by the international experience of the vertical structure of the tax administration. It is contended in the article that the reform of the vertical arrangements of the tax authorities is an attempt to deepen the reform of the fiscal system and promoting tax administrative agencies reform in the broad sense from the perspective of the modernization of the state governance system and governance abilities. The article concludes with a summary of several features of this reform.


1. Since 2018 year the subnational tax agencies in China will be abolished gradually and the separate system of vertical administrative agencies will officially end

2. The removal of the subnational tax agencies is the result of balancing on the advantages and disadvantages of the separate tax collection agencies and new overall goal of reform in China. It is part of the reform of government institutions aimed at promoting the modernization of the state’s governance

3. The reform is making full use of the advanced experience of foreign countries

4. The reform is based on the construction of a general public service supply system, with tax administration agency as part of it. It is a step forward in the direction of specialization and independence of tax administrations


Ma Jun. The reform of vertical arrangements of tax administrative agencies in China. Journal of Tax Reform, 2018, vol. 4, no. 3, pp. 223–235. DOI: 10.15826/jtr.2018.4.3.053


Received April 24, 2018; accepted December 13, 2018


tax administration, China’s tax authorities, vertical arrangement of tax agency, reform the tax administrative system, international practices of the tax administration, China


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